Compare Unsecured Business Loans

Compare Unsecured Business Loans

Getting an unsecured business loan means that your UK company can receive valuable funding to cover setup costs, or to finance further improvements such as staff training, specialist equipment or improving your advertising.

If you have been thinking of borrowing money for your business, then it’s worth finding out everything you can about unsecured business loans, so you know what to look for when comparing lenders and deals. Discover the best unsecured business loans based on our panel of lenders.

What is an unsecured business loan?

• A loan to help you set up your new business or invest in your existing business
• Is often a lower amount between £1,000-£25,000 but it can be more
• Unsecured meaning it isn’t ‘secured’ against a high-value asset
• Much safer and less risk than a secured business loan

An unsecured business loan refers to a loan that isn’t ‘secured’ against a high-value asset that you own (such as commercial property or your home), but simply leant to you based on your credit score, business credit score, your financial history or a combination of all three.

It is the opposite to a secured business loan, which will allow you to borrow more money, but is much riskier, given that the lender can repossess your high-value assets if you fail to make repayments. This makes an unsecured loan preferable for those looking at borrowing money, but will require you to have a good credit score as a sole trader, start up, small business or even limited company.

How can I get an unsecured business loan?

To get an unsecured business loan, you will usually have to have a good business credit score to prove that you have borrowed money responsibly in the past. Providing your financial records will mean that a lender can see how much money your business makes and subsequently how much you would be able to pay towards a business loan every month.

A lender will also ask for business details such as your Companies House number, registered business address, names of any partners involved in the business and any other applicable personal details. All of this information will usually be gathered during an online application.

Can I apply for an unsecured business loan?

The following actions will help you check your eligibility for an unsecured business loan:

• Credit Report – look at your financial history and check your credit score
• Business Credit Score – see if you’re business has a good score from previous borrowing
• Free eligibility tool – if you’ve ever used an eligibility checker such as moneymatcher, this might give you an indication whether you can personally apply for credit as a sole trader or start up. If you’re an existing business, simply check your credit score instead.

Once you have checked your eligibility, it’s worth comparing unsecured business loans from our tables to see which one might offer the best deals for you and your business.